At the 11th Michelin Challenge Bibendum ? a gigantic green car expo held more or less annually since 1998 ? Volvo was on hand to show off its upcoming V60 plug-in hybrid electric vehicle (PHEV) and offer test drives to journalists in two nearly production-ready prototypes.

Not only will the V60 PHEV be the company's first plug-in hybrid consumer offering when it reaches showrooms in late 2012, it is also on track to be the first production plug-in hybrid in the world to have four-wheel drive capability. This fact alone makes it a very enticing next-generation vehicle package, but when combined with the functionality of a large wagon, Volvo's reputation for safety, excellent performance and the striking looks of the new V60, Volvo seems to have struck a green nerve.

In a rather unique drivetrain system, the V60 PHEV has a 215 horsepower diesel engine to drive the front wheels and a 70 horsepower electric motor for the rear wheels. Unlike with the Chevy Volt ? another PHEV ? the two systems on the V60 operate independently from one another with absolutely no mechanical connection between them; when the V60 PHEV is operating in electric-only mode, it is strictly a rear wheel drive vehicle.

The V60 PHEV has three basic modes of driving, controlled by buttons on the dash. "Hybrid" mode is the car's default startup setting and uses battery and diesel power as required by the demands of the driver ? operating purely on electricity when it can, but turning on the engine to help accelerate. "Pure" mode maximizes the vehicle's range by limiting power and acceleration. In this mode the vehicle can travel up to 31 miles on stored battery power from your outlet before switching over to "Hybrid" mode. "Power" mode uses both the diesel engine and the electric motor to provide the best acceleration possible ? at the expense of efficiency ?resulting in a fairly impressive zero to 60 mph time of 6.9 seconds.

In addition to these three modes, the V60 PHEV can be shifted into four-wheel drive at the touch of a button, forcing both the diesel and the electric motor to drive their respective wheels at the same time. Altogether, Volvo says the V60 PHEV will return an average of 124 mpg, but as with all PHEVs, that number can vary drastically based on your individual driving habits. For instance, if you never drive more than 31 miles in a day you could conceivably use no fuel.

During a short test drive the V60 PHEV seemed to be a very capable vehicle. Acceleration was impressive in Power mode, and four-wheel drive worked well to keep the vehicle planted in the corners. Given that it's based on an already-existing car, Volvo representatives told us that it's "ninety-eight percent" of the way there, but there are still many components on the prototypes that are handmade. Even so, it's clear that it's essentially ready for prime time.

Given the car's positives it would seem that its success is virtually assured. However, there's still one major sticking point: price. All that high technology certainly won't come cheap.

Although unable to provide specifics at this point ? the vehicle is a year and a half away from production after all ? Volvo's V60 Business Project Leader, Karl-Johan Ekman, told AutoTrader at the event that the V60 PHEV will be a car that "costs a lot of money." He added that Volvo's objective is to have a price that is "fair and makes sense," but said that "if your only objective is to get a car for as little money as possible, then this will not be the car for you."

Volvo doesn't currently sell the conventional V60 in the US, so there has been some question about the plug-in version ever making it to our shores ? especially given the diesel engine. Ekman made it clear that the diesel version will likely stay only in Europe, but strongly hinted that a gasoline-powered version of the V60 PHEV could be sold here. "I can say this much," he remarked, "this system is very much applicable to other powertrains, and we will use it in more vehicles ? we would be stupid if we didn't do that."

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Nick Chambers is a "next generation" car enthusiast, recognized for his green automotive coverage in Gas 2.0, The New York Times, Popular Mechanics, HybridCars.com and PluginCars.com. In addition, he's been syndicated in Matter Network, AP and Reuters.

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